Two significant recommendations from the Panel signal that changes are on the way. First, they recommended a new, separate board with standard-setting authority under the oversight of the FAF. Second, there will be changes and modifications to existing and future GAAP that reflects the unique needs of users of private company financial statements.

These recommendations arise from the long-standing criticism that what drives accounting standards is driven primarily by issues affecting public companies. Lenders, investors, and business owners regularly question the relevance and usefulness of GAAP as it relates to private companies.

We hope these changes will provide some relief to private companies. There will, however, be a transition period where private business owners, CFOs, and accountants will re-educate themselves on the changes. Keep your ears open on changes that may affect you in the near future.